0001683168-16-000708.txt : 20161118 0001683168-16-000708.hdr.sgml : 20161118 20161118133055 ACCESSION NUMBER: 0001683168-16-000708 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 28 CONFORMED PERIOD OF REPORT: 20160930 FILED AS OF DATE: 20161118 DATE AS OF CHANGE: 20161118 FILER: COMPANY DATA: COMPANY CONFORMED NAME: RC-1, Inc. CENTRAL INDEX KEY: 0001665598 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-RACING, INCLUDING TRACK OPERATION [7948] IRS NUMBER: 463007571 STATE OF INCORPORATION: NV FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 333-210960 FILM NUMBER: 162007295 BUSINESS ADDRESS: STREET 1: PO BOX 12589 CITY: NEWPORT BEACH STATE: CA ZIP: 92658 BUSINESS PHONE: 949-721-1225 MAIL ADDRESS: STREET 1: PO BOX 12589 CITY: NEWPORT BEACH STATE: CA ZIP: 92658 10-Q 1 rc1_10q-093016.htm FORM 10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 10-Q

 

x QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the quarterly period ended September 30, 2016

 

o TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT

 

For the transition period from ______________ to _____________

 

Commission file number 333-210960

 

RC-1, INC.

(Exact name of small business issuer as specified in its charter)

 

Nevada 26-1449268
(State or other jurisdiction of incorporation or organization) (IRS Employer Identification No.)

 

110 Sunrise Center Drive

Thomasville, NC 27360

(Address of principal executive offices)

 

800.348.2870

(Issuer’s telephone number)

 

_______________________________________________

(Former name, former address and former fiscal year, if changed since last report)

 

Check whether the issues (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No o

 

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes x No o

 

Indicate by check mark whether the Registrant is a large accelerated filer, an accredited filer, a non-accredited filer, (or a smaller reporting company in Rule 12b-2 of the Exchange Act.(check one)


  Large Accelerated filer o Accelerated filer o
  Non-accelerated filer o Smaller reporting company x

 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o No x

 

There were 7,929,581 shares of the registrant’s common stock, $0.001 par value per share, outstanding on September 30, 2016.

 

 

 

   
 

 

RC-1, INC.

 

TABLE OF CONTENTS

 

      Page
       
Part I – FINANCIAL INFORMATION  
     
  Item 1. Condensed Financial Statements: 3
       
    Condensed Balance Sheets at September 30, 2016 and December 31, 2015 (unaudited) 3
       
    Condensed Statements of Operations for the three and nine month periods ended September 30, 2016 and 2015 (unaudited) 4
       
    Condensed Statements of Cash Flows for the nine month period ended September 30, 2016 and September 30, 2015 (unaudited) 5
       
    Notes to Condensed Financial Statements (unaudited) 6
       
  Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations 8
       
  Item 3. Quantitative and Qualitative Disclosures About Market Risk 10
       
  Item 4. Controls and Procedures 10
       
Part II – OTHER INFORMATION  
       
  Item 1.  Legal Proceedings 12
     
  Item 2.  Unregistered Sales of Equity Securities and Use of Proceeds 12
       
  Item 3. Defaults Upon Senior Security 12
       
  Item 4. Mine Safety Disclosures 12
       
  Item 5. Other Information 12
       
  Item 6. Exhibits 12
       
    Signatures 13

 

 

 

 

 

 

 

 2 

 

 

PART I – FINANCIAL INFORMATION

ITEM 1. Financial Statements

 

RC-1, Inc.

CONDENSED BALANCE SHEETS

(UNAUDITED)

 

   September 30,   December 31, 
   2016   2015 
ASSETS          
           
Current assets          
Cash  $45,458   $49,118 
Total current assets   45,458    49,118 
           
Fixed assets - net   106,667    136,667 
           
Total Assets  $152,125   $185,785 
           
LIABILITIES & STOCKHOLDERS' EQUITY          
           
Current liabilities          
Accounts payable  $24,015   $ 
Accrued payables - related parties   165,000    120,000 
Line of credit   75,000    76,459 
Line of credit - related parties   500,536    458,277 
Accrued interest payable   20,543    14,918 
Accrued interest payable - related party   76,040    50,322 
Total current liabilities   861,134    719,976 
           
Total Liabilities   861,134    719,976 
           
Stockholders' Equity          
Preferred stock, $.0010 par value; 10,000,000 shares authorized; no shares issued and outstanding        
Common stock, $.0001 par value; 190,000,000 shares authorized; 7,929,581 shares issued and outstanding   792    792 
Additional paid in capital   2,244,829    2,244,829 
Accumulated deficit   (2,954,630)   (2,779,812)
           
Total Stockholders' Equity   (709,009)   (534,191)
           
Total Liabilities and Stockholders' Equity  $152,125   $185,785 

 

 

 

 

 

The accompanying notes are an integral part of the unaudited condensed financial statements. 

 

 3 

 

 

RC-1, Inc.

CONDENSED STATEMENTS OF OPERATIONS

(UNAUDITED)

 

   Three Months Ended   Nine Months Ended 
   September 30,   September 30,   September 30,   September 30, 
   2016   2015   2016   2015 
Revenues  $   $   $   $1,000 
                     
Cost of sales                
Gross margin               1,000 
                     
Operating expenses:                    
Race expenses   15,003    10,500    15,003    27,118 
Consulting to related parties   15,000    62,500    45,000    153,000 
General and administrative   13,030    10,000    33,095    30,006 
Professional fees   22,402    3,250    50,377    15,750 
    65,435    86,250    143,475    225,874 
                     
Operating income (loss)   (65,435)   (86,250)   (143,475)   (224,874)
                     
Other income (expense):                    
Interest expense   (1,875)   (2,090)   (5,625)   (5,840)
Interest expense - related parties   (9,013)   (5,164)   (25,718)   (15,493)
    (10,888)   (7,254)   (31,343)   (21,333)
                     
Net Income Before Taxes   (76,323)   (93,504)   (174,818)   (246,207)
                     
Income Tax Provision                
                     
Net income (loss)  $(76,323)  $(93,504)  $(174,818)  $(246,207)
                     
Net income (loss) per share                    
(Basic and fully diluted)  $(0.01)  $(0.01)  $(0.02)  $(0.03)
                     
Weighted average number of common shares outstanding   7,929,581    7,929,581    7,929,581    7,929,581 

 

 

 

The accompanying notes are an integral part of the unaudited condensed financial statements. 

 

 4 

 

 

RC-1, Inc.

CONDENSED STATEMENTS OF CASH FLOWS

(UNAUDITED)

 

   Nine Months Ended 
   September 30,   September 30, 
   2016   2015 
Cash Flows From Operating Activities:          
Net income (loss)  $(174,818)  $(246,207)
Adjustments to reconcile net loss to net cash provided by (used for) operating activities:          
Depreciation   30,000    30,000 
Changes in Operating Assets and Liabilities          
Increase (decrease) in accounts payable   24,015    (13,300)
Increase in accounts payable - related parties   45,000    45,000 
Increase in accrued interest   5,625    5,625 
Increase in accrued interest-related parties   25,718    15,493 
           
Net cash used for operating activities   (44,460)   (163,389)
           
Cash Flows From Investing Activities:          
Assets purchased        
           
Cash Flows From Financing Activities:          
Repayments on line of credit   (1,459)   (2,226)
Proceeds from line of credit to related party   187,359    245,664 
Repayments on line of credit to related party   (145,100)   (66,126)
           
Net cash provided by financing activities   40,800    177,312 
           
Net Increase (Decrease) In Cash   (3,660)   13,923 
           
Cash At The Beginning Of The Period   49,118    27,725 
           
Cash At The End Of The Period  $45,458   $41,648 
           
           
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION          
           
Cash paid during the year for:          
Interest  $   $ 
Income tax  $   $ 

 

 

 

 

 

The accompanying notes are an integral part of the unaudited condensed financial statements.

 

 5 

 

 

RC-1, Inc.

NOTES TO CONDENSED FINANCIAL STATEMENTS (Unaudited)

For the Three and Nine Months Ended September 30, 2016 and 2015

 

 

NOTE 1. ORGANIZATION AND DESCRIPTION OF BUSINESS OPERATIONS

 

RC-1, Inc. (the “Company”), was incorporated in the State of Nevada on May 14, 2009. The Company is currently considered to be in the development stage, and has generated only limited revenues from its activities in the racing business. R-Course Promotions, LLC was formed in the State of California on October 30, 2007. On June 1, 2009, in a merger classified as a transaction between parties under common control, the sole membership interest owner in R-Course Promotions, LLC exchanged 125,000 membership interests for 1,786 common shares in RC-1, Inc. Subsequent to the consummation of the merger, R-Course Promotions, LLC ceased to exist. The results of operations of RC-1, Inc. and R-Course Promotions, LLC have been combined from October 30, 2007 forward through the date of merger.

 

The Company is a motorsports marketing business focused primary in road racing events in North America utilizing NASCAR type competition equipment.

 

NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

 

Basis of presentation

The Company’s financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”).

 

Interim Financial Statements

The accompanying financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to form 10Q and Article 8 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In our opinion the financial statements include all adjustments (consisting of normal recurring accruals) necessary in order to make the financial statements not misleading. Operating results for the nine months ended September 30, 2016 are not necessarily indicative of the final results that may be expected for the year ended December 31, 2016. For more complete financial information, these unaudited financial statements should be read in conjunction with the audited financial statements for the year ended December 31, 2015 filed with the SEC.

 

Use of Estimates

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

 

Net income (loss) per share

The Company utilizes FASB ASC 260, “Earnings per Share.” Basic earnings per share is computed by dividing earnings (loss) attributable to common stockholders by the weighted-average number of common shares outstanding during the reporting period. Diluted earnings per share is computed similar to basic earnings per share except that the denominator is increased to include additional common share equivalents available upon exercise of stock options and warrants using the treasury stock method. Dilutive common share equivalents include the dilutive effect of in-the-money share equivalents, which are calculated based on the average share price for each period using the treasury stock method, excluding any common share equivalents if their effect would be anti-dilutive. For the nine months ended September 30, 2016 and year ended December 31, 2015 there were no potentially dilutive shares.

 

Recent Accounting Pronouncements

Management does not believe that any recently issued, but not yet effective, accounting standards, if adopted, will have a material effect on our financial statements.

 

 

 6 

 

 

NOTE 3. GOING CONCERN

 

These financial statements have been prepared in accordance with generally accepted accounting principles applicable to a going concern, which contemplates the realization of assets and the satisfaction of liabilities and commitments in the normal course of business. The Company's ability to continue as a going concern is contingent upon its ability to achieve and maintain profitable operations, and the Company’s ability to raise additional capital as required.

 

These conditions raise substantial doubt about the Company's ability to continue as a going concern. These financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts, or amounts and classification of liabilities that might result from this uncertainty.

 

NOTE 4. RELATED PARTY TRANSACTIONS

 

Consulting expense to related parties

 

On January 1, 2015, the Company extended for three years a previous consulting agreement with a company owned and operated by the CEO and majority shareholder to provide consulting services in the motor sports marketing industry. The consulting agreement requires a $5,000 monthly fee and can be terminated by either party pursuant to a 60 day notice. As of September 30, 2016, and December 31, 2015, the Company had an accrued payable balance due to this related party of $165,000 and $120,000, respectively. During the three months ended September 30, 2016 and 2015, the Company incurred related party consulting expense of $15,000 and $45,000 respectively. During the nine months ended September 30, 2016 and 2015, the Company incurred related party consulting expense of $ $45,000 respectively.

 

On January 1, 2014, the Company entered into an event services agreement with an event services company that is owned and controlled by an individual who is also the owner and controller of a separate company that became an owner of 16.6% of the Company's issued and outstanding common shares on June 15, 2014. During the three months ended September 30, 2016 and 2015, the Company incurred and paid $0 and $47,500, respectively, in consulting fees to this event services company. During the nine months ended September 30, 2016 and 2015, the Company incurred $0 and $108,000, respectively, in consulting fees to this event services company.

 

Due to related parties

 

On October 1, 2009, the Company entered into a line of credit agreement for up to $600,000 with a related party owned and operated by the CEO and majority shareholder that also provides motor sports marketing industry consulting services to the Company as needed. Under the agreement, the Company receives operating fund advances and reimbursement for expenses incurred on behalf of the Company. The loan bears interest at eight percent (8%) per annum. As of September 30, 2016, and December 31, 2015, the Company owed $178,164 and $155,364, respectively, in operating advances to this related party. As of September 30, 2016, and December 31, 2015, the Company had accrued interest on this line of credit in the amounts of $15,606 and $5,532, respectively.

   

On August 5, 2013, the Company entered into a line of credit agreement for up to $600,000 with a related party owned and operated by the CEO and majority shareholder. Under the agreement, the Company receives operating fund advances and reimbursement for expenses incurred on behalf of the Company. As of September 30, 2016, and December 31, 2015, the Company owed $322,372 and $302,913, respectively, in operating advances to this related party. As of September 30, 2016, and December 31, 2015, the Company had accrued interest on this line of credit in the amounts of $60,434 and $44,790, respectively.

 

NOTE 5. SUBSEQUENT EVENTS

 

Management was evaluated subsequent events pursuant to the requirements of ASC Topic 855 and has determined that other than listed below, no material subsequent events exist through the date of this filing.

 

 7 

 

 

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION OR PLAN OF OPERATION

 

FORWARD-LOOKING STATEMENT NOTICE

 

This Form 10-Q contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. For this purpose any statements contained in this Form 10-Q that are not statements of historical fact may be deemed to be forward-looking statements. Without limiting the foregoing, words such as “may,” “will,” “expect,” “believe,” “anticipate,” “estimate” or “continue” or comparable terminology are intended to identify forward-looking statements. These statements by their nature involve substantial risks and uncertainties, and actual results may differ materially depending on a variety of factors, many of which are not within our control. These factors include but are not limited to economic conditions generally and in the industries in which we may participate; competition within our chosen industry, including competition from much larger competitors; technological advances and failure to successfully develop business relationships.

 

BUSINESS OF THE COMPANY

 

Background

 

We are a development stage small motorsports production company which was originally organized in 2007 to participate in “Road Racing” motorsports events organized by several motorsports sanctioning bodies such as The National Association for Stock Car Auto Racing ("NASCAR"), and The International Motorsports Association ("IMSA"). The Road Racing motorsports events require the use of “Stock Cars” that are professionally modified for Road Racing, and “Sports Cars” that are specifically manufactured for competition Road Racing. The Company's principal executive offices are located at 110 Sunrise Center Drive, Thomasville, NC 27360 and its telephone number is (760) 230-1617

 

We are focused on ways to attract new sponsors, agency clients and collect money purses for finishing positions. The Company engages in regional and national motorsports events involving road course racing. The Company has the potential to earn revenues in multiple ways. The Company owns three race cars which it uses for promotional and marketing operations as well as from time to time enters into races for a chance at winning purse money. Only if the Company race car finishes in a top position, will it earn purse money. The Company’s target revenue stream is to actively market its advertising services in the mobile billboard industry. The Company also plans to negotiate sponsorship deals with other race teams whereby the Company acts as an agent to sell advertising sponsorship packages.

 

In 2012, we commenced offering racing production and management services to potential clients that wish to participate in motorsports racing. Our production services range from producing a full "turnkey" motorsports racing team, to sourcing or providing management of, or access to, any part of equipment or human services required to participate in one or more racing events. The following is a list of some of what services we offer to potential clients:

 

Acting as consultant and liaison between the client and the sanctioning body so that the client is able to participate in motorsport events.
 
Sourcing of:
fully prepared and ready for racing racecars
racing driver(s)
crew chiefs
car chiefs
Mechanic crews
"Over the wall" pit crews
 
Producing pre- and post-race social events

 

Among our potential clients are racing drivers who wish to participate in sanctioned racing events; businesses that wish to market their brand through participation in sanctioned racing events; businesses which wish to stage hosting and promotional parties and events before, during and after sanctioned race events, and race teams that are unfamiliar with particular racing series event and require our assistance to participate in such racing series.

 

 

 

 8 

 

 

In 2015, we participated in the following NASCAR sanctioned events:

 

Date Series Track Name of Event
3/13/15 NASCAR Mexico Series Phoenix International Raceway  
5/17/15 NASCAR Canadian Pinty Series Bowmanville, Canada  
8/29/2015 NASCAR Xfinity Series Road America, Wisconsin Road America 180
8/8/2015 NASCAR Xfinity Series Watkins Glen, New York Zippo 200

 

In 2016, when we enter a racing event for marketing purposes, we intend to use our own vehicles, and equipment, or lease a vehicle for the event. Also, when we use our own vehicles in an event, we expect to offer advertising space on our vehicles to clients desiring to use our cars and equipment to display and market their product or services by having the client's logo prominently appear on the vehicle. Our ability to attract clients for our production services or advertising services will, in part, be dependent upon the success of our drivers and racecars in the races we may decide to enter. We believe that if we win, or finish within the top 20 finishing places in a race, our ability to attract clients for our production services and advertisers will be enhanced. There can be no assurance that we will be able to secure clients for our production services nor advertisers for our vehicles.

 

PLAN OF OPERATIONS

 

Three Months Ended September 30, 2016 Compared to Three Months Ended September 30, 2015 

 

Revenues

 

The Company had no revenue during the three months ended September 30, 2016 and September 30, 2015.

 

Operating Expenses

 

For the three months ended September 30, 2016 operating expenses were $65,435 compared to $86,250 for the same period in 2015 for a decrease of $20,815. The decrease was primarily a result of the decrease in Consulting to Related Parties to $15,000 from $62,500.

 

Interest and Financing Costs

 

Interest expense to unrelated parties was $1,875 for the three months ended September 30, 2016 compared to $2,090 in the three months ended September 30, 2015. Interest expense accrued to related parties for the three months ended September 30, 2016 was $9,013 as compared to $5,164 for the three months ended September 30, 2015.

 

Net Income (Loss)

 

The Company incurred losses of $76,323 for the three months ended September 30, 2016 compared to $93,504 during the three months ended September 30, 2015 due to the factors discussed above.

 

Nine Months Ended September 30, 2016 Compared to Nine Months Ended September 30, 2015 

 

Revenues

 

The Company had no revenue during the three months ended September 30, 2016 compared to $1,000 for the same period ended September 30, 2015.

 

Operating Expenses

 

For the nine months ended September 30, 2016 operating expenses were $143,475 compared to $225,874 for the same period in 2015 for a decrease of $82,399. The decrease was primarily a result of the decrease in Consulting to Related Parties to $45,000 from $153,000 and a decrease in Race Expenses to $15,003 compared to $27,118 for the same period in 2015.

 

Interest and Financing Costs

 

Interest expense to unrelated parties was $5,625 for the nine months ended September 30, 2016 compared to $5,840 in the nine months ended September 30, 2015. Interest expense accrued to related parties for the nine months ended September 30, 2016 was $25,718 as compared to $15,495 for the nine months ended September 30, 2015.

 

 9 

 

 

Net Income (Loss)

 

The Company incurred losses of $174,818 in the nine months ended September 30, 2016 compared to $246,207 during the nine months ended September 30, 2015 due to the factors discussed above.

 

LIQUIDITY AND CAPITAL RESOURCES

 

The Company's financial statements have been prepared on a going concern basis, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business. The financial statements do not include any adjustment relating to recoverability and classification of recorded amounts of assets and liabilities that might be necessary should the Company be unable to continue as a going concern.

 

The Company has a minimum cash balance available for payment of ongoing operating expenses and has incurred losses since inception and anticipates future losses in the development of its business raising substantial doubt about the Company’s ability to continue as a going concern. Its continued existence is dependent upon its ability to continue to execute its operating plan and to obtain additional debt or equity financing. There can be no assurance the necessary debt or equity financing will be available, or will be available on terms acceptable to the Company.

 

The Company had $45,458 in cash at September 30, 2016 with availability on our related party line of credit with General Pacific Partners, LLC of $421,536. We had a working capital deficit of $815,676.

 

Operating activities

 

During the nine months ended September 30, 2016, we used $44,460 in operating activities compared to $163,389 during the nine months ended September 30, 2015, a decrease of $118,929. The decrease between the two periods was largely due to a reduction in operating costs paid and an increase in accounts payable in 2016.

 

Investing activities

 

We neither generated nor used cash flow in investing activities during the nine months ended September 30, 2016 and the same for the period in 2015.

 

Financing activities

 

During the nine months ended September 30, 2016, we generated $40,800 from financing activities compared to $177,312 for the same period ended September 30, 2015, a decrease of $136,512. The change was due primarily to the reduction in operating costs paid in 2016 and increases in accounts payable and accrued expenses. This resulted in decreased need to borrow on available lines of credit.

 

ITEM 3. Quantitative and Qualitative Disclosures about Market Risk.

 

As a “smaller reporting company,” we are not required to provide the information under this Item 3.

 

ITEM 4. Controls and Procedures

 

Evaluation of disclosure controls and procedures

 

Based upon an evaluation of the effectiveness of our disclosure controls and procedures performed by our Chief Executive Officer as of the end of the period covered by this report, our Chief Executive Officer concluded that our disclosure controls and procedures have not been effective as a result of a weakness in the design of internal control over financial reporting identified below.

 

As used herein, “disclosure controls and procedures” mean controls and other procedures of our company that are designed to ensure that information required to be disclosed by us in the reports that we file or submit under the Securities Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the Commission’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by us in the reports that we file or submit under the Securities Exchange Act is accumulated and communicated to our management, including our principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.

 

 

 

 10 

 

 

Management’s Report on Internal Control over Financial Reporting

 

Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Exchange Act Rule 13a-15(f). The Company’s internal control over financial reporting is a process designed to provide reasonable assurance to our management and board of directors regarding the reliability of financial reporting and the preparation of the financial statements for external purposes in accordance with accounting principles generally accepted in the United States of America.

 

Our internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the Company; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with accounting principles generally accepted in the United States of America, and that receipts and expenditures of the Company are being made only in accordance with authorizations of management and directors of the Company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the Company’s assets that could have a material effect on the financial statements.

 

This quarterly report does not include an attestation report of our registered independent public accounting firm regarding internal control over financial reporting. Management’s report was not subject to attestation by our registered independent public accounting firm.

 

Changes in Internal Control Over Financial Reporting

 

No changes in our internal control over financial reporting occurred during the nine months ended September 30, 2016 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

 

 

 11 

 

 

PART II – OTHER INFORMATION

 

ITEM 1. Legal Proceedings

 

We know of no material, existing or pending legal proceedings against us, nor are we involved as a plaintiff in any material proceeding or material pending litigation. There are no proceedings in which any of our directors, officers or affiliates, or any registered or beneficial shareholder, is an adverse party or has a material interest adverse to our company.

 

ITEM 2. Unregistered Sales of Equity Securities and Use of Proceeds

 

During the nine months ended September 30, 2016, there were no sales of shares of the Company's common stock.

 

ITEM 3. Default Upon Senior Securities

 

During the nine months ended September 30, 2016, the Company had no senior securities issued and outstanding.

 

ITEM 4. Mine Safety Disclosures

 

Not applicable to our Company.

 

ITEM 5. Other Information

 

None.

 

ITEM 6. Exhibits

 

Copies of the following documents are included as exhibits to this report pursuant to Item 601 of Regulation S-K

 

SEC Ref. No.   Title of Document
31.1*   Certification of the Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2*   Certification of the Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1*   Certification of the Principal Executive Officer pursuant to U.S.C. pursuant to Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
32.2*   Certification of the Principal Financial Officer pursuant to U.S.C. pursuant to Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101.INS*   XBRL Instance Document
101.SCH*   XBRL Schema Document
101.CAL*   XBRL Calculation Linkbase Document
101.DEF*   XBRL Definition Linkbase Document
101.LAB*   XBRL Label Linkbase Document
101.PRE*   XBRL Presentation Linkbase Document

 

*   Filed herewith.

 

 

 

 

 

 

 

 

 

 12 

 

 

SIGNATURES

  

In accordance with Section 13 or 15(d) of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

 

RC-1, Inc.

 

November 18, 2016

 

By: /s/ Kevin O'Connell

Kevin O'Connell

Chief Executive Officer

 

 

 

 

 

 

 

 

 

 

 

 13 

 

EX-31.1 2 rc1_10q-ex3101.htm CERTIFICATIONS

Exhibit 31.1

 

CERTIFICATIONS PURSUANT TO

SECTION 302 OF

THE SARBANES-OXLEY ACT OF 2002

 

 

I, Kevin O'Connell, certify that:

 

1. I have reviewed this Quarterly Report on Form 10-Q of RC-1, Inc., Inc. for the period ended September 30, 2016.

 

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

 

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

 

4. The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

 

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

 

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

 

c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

 

d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting.

 

5. The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

 

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

 

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

 

November 18, 2016

 

/s/ Kevin O'Connell                            

Name:  Kevin O'Connell

Its:  Chief Executive Officer (Principal Executive Officer)

 

 

 

EX-31.2 3 rc1_10q-ex3102.htm CERTIFICATIONS

Exhibit 31.2

 

CERTIFICATIONS PURSUANT TO

SECTION 302 OF

THE SARBANES-OXLEY ACT OF 2002

  

I, Rayna Austin, certify that:

 

1. I have reviewed this Quarterly Report on Form 10-Q of RC-1, Inc. for the nine month period ended September 30, 2016.

 

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

 

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

 

4. The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

 

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

 

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

 

c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

 

d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting.

 

5. The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

 

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

 

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

 

 

November 18, 2016

 

/s/  Rayna Austin                            

Name: Rayna Austin
Its: Principal Financial Officer

 

 

 

 

 

 

EX-32.1 4 rc1_10q-ex3201.htm CERTIFICATIONS

Exhibit 32.1

 

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO SECTION 906

OF THE SARBANES-OXLEY ACT OF 2002

 

In connection with the Quarterly Report of RC-1, Inc. (the “Company”) on Form 10-Q, for the period ended September 30, 2016 as filed with the Securities and Exchange Commission, I, Kevin O'Connell, Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

 

(1)           The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

 

(2)           The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company.

 

 

November 18, 2016

 

/s/   Kevin O'Connell                            

Name:  Kevin O'Connell

Its:  Chief Executive Officer (Principal Executive Officer)

 

 

EX-32.2 5 rc1_10q-ex3202.htm CERTIFICATIONS

Exhibit 32.2

 

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO SECTION 906

OF THE SARBANES-OXLEY ACT OF 2002

 

In connection with the Quarterly Report of RC-1, Inc. (the “Company”) on Form 10-Q, for the period ended September 30, 2016 as filed with the Securities and Exchange Commission, I, Rayna Austin, Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

 

(1)           The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

 

(2)           The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company.

 

 

November 18, 2016

 

/s/   Rayna Austin                            

Name: Rayna Austin

Its: Principal Financial Officer

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Entity Filer Category Entity Public Float Entity Common Stock, Shares Outstanding Document Fiscal Period Focus Document Fiscal Year Focus Statement of Financial Position [Abstract] ASSETS Current assets Cash Total current assets Fixed assets - net Total Assets LIABILITIES & STOCKHOLDERS' EQUITY Current liabilities Accounts payable Accrued payables - related parties Line of credit Due to related parties Accrued interest payable Accrued interest payable - related party Total current liabilities Total Liabilities Stockholders' Equity Preferred stock, $.0010 par value; 10,000,000 shares authorized; no shares issued and outstanding Common stock, $.0001 par value; 190,000,000 shares authorized; 7,929,581 shares issued and outstanding Additional paid in capital Accumulated deficit Total Stockholders' Equity Total Liabilities and Stockholders' Equity Preferred stock, par value Preferred stock, shares authorized Preferred stock, shares issued Preferred stock, shares outstanding Common stock, par value Common stock, shares authorized Common stock, shares issued Common stock, shares outstanding Income Statement [Abstract] Revenues Cost of sales Gross margin Operating expenses: Race expenses Consulting - related parties General and administrative Professional fees Total operating expenses Operating income (loss) Other income (expense): Interest expense Interest expense - related parties Total other income (expense) Net Income Before Taxes Income Tax Provision Net income (loss) Net income (loss) per share (Basic and fully diluted) Weighted average number of common shares outstanding Statement of Cash Flows [Abstract] Cash Flows From Operating Activities: Net income (loss) Adjustments to reconcile net loss to net cash provided by (used for) operating activities: Depreciation Changes in Operating Assets and Liabilities Increase (decrease) in accounts payable Increase in accounts payable - related parties Increase in accrued interest Increase in accrued interest-related parties Net cash used for operating activities Cash Flows From Investing Activities: Assets purchased Cash Flows From Financing Activities: Repayments on line of credit Proceeds from line of credit to related party Repayments on line of credit to related party Net cash provided by financing activities Net Increase (Decrease) In Cash Cash At The Beginning Of The Period Cash At The End Of The Period SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION Interest Income tax Organization, Consolidation and Presentation of Financial Statements [Abstract] Organization and Description of Business Operations Accounting Policies [Abstract] Summary of Significant Accounting Policies Going Concern Related Party Transactions [Abstract] Related Party Transactions Subsequent Events [Abstract] Subsequent Events Basis of presentation Interim Financial Statements Use of Estimates Cash and cash equivalents Property and equipment Financial Instruments Revenue recognition Net income (loss) per share Products and services, geographic areas and major customers Concentrations of debt financing Recent Accounting Pronouncements Statement [Table] Statement [Line Items] Related Party Transaction [Axis] Accounts payable - related parties Consulting to related parties Accrued interest payable - related party Assets, Current Assets Liabilities, Current Liabilities Stockholders' Equity Attributable to Parent Liabilities and Equity Operating Expenses Operating Income (Loss) Interest Expense Interest Expense, Related Party Nonoperating Income (Expense) Income (Loss) from Continuing Operations before Income Taxes, Noncontrolling Interest Net Cash Provided by (Used in) Operating Activities, Continuing Operations Payments to Acquire Property, Plant, and Equipment Repayments of Lines of Credit Repayments of Related Party Debt Net Cash Provided by (Used in) Financing Activities, Continuing Operations Cash, Period Increase (Decrease) EX-101.PRE 11 rcrs-20160930_pre.xml XBRL PRESENTATION FILE XML 12 R1.htm IDEA: XBRL DOCUMENT v3.5.0.2
Document and Entity Information
9 Months Ended
Sep. 30, 2016
shares
Document And Entity Information  
Entity Registrant Name RC-1, Inc.
Entity Central Index Key 0001665598
Document Type 10-Q
Document Period End Date Sep. 30, 2016
Amendment Flag false
Current Fiscal Year End Date --12-31
Is Entity a Well-known Seasoned Issuer? No
Is Entity a Voluntary Filer? No
Is Entity's Reporting Status Current? Yes
Entity Filer Category Smaller Reporting Company
Entity Common Stock, Shares Outstanding 7,929,581
Document Fiscal Period Focus Q3
Document Fiscal Year Focus 2016
XML 13 R2.htm IDEA: XBRL DOCUMENT v3.5.0.2
Condensed Balance Sheets (Unaudited) - USD ($)
Sep. 30, 2016
Dec. 31, 2015
Current assets    
Cash $ 45,458 $ 49,118
Total current assets 45,458 49,118
Fixed assets - net 106,667 136,667
Total Assets 152,125 185,785
Current liabilities    
Accounts payable 24,015 0
Accrued payables - related parties 165,000 120,000
Line of credit 75,000 76,459
Due to related parties 500,536 458,277
Accrued interest payable 20,543 14,918
Accrued interest payable - related party 76,040 50,322
Total current liabilities 861,134 719,976
Total Liabilities 861,134 719,976
Stockholders' Equity    
Preferred stock, $.0010 par value; 10,000,000 shares authorized; no shares issued and outstanding 0 0
Common stock, $.0001 par value; 190,000,000 shares authorized; 7,929,581 shares issued and outstanding 792 792
Additional paid in capital 2,244,829 2,244,829
Accumulated deficit (2,954,630) (2,779,812)
Total Stockholders' Equity (709,009) (534,191)
Total Liabilities and Stockholders' Equity $ 152,125 $ 185,785
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Condensed Balance Sheets (Parenthetical) - $ / shares
Sep. 30, 2016
Dec. 31, 2015
Statement of Financial Position [Abstract]    
Preferred stock, par value $ .0010 $ 0.0010
Preferred stock, shares authorized 10,000,000 10,000,000
Preferred stock, shares issued 0 0
Preferred stock, shares outstanding 0 0
Common stock, par value $ .0001 $ 0.0001
Common stock, shares authorized 190,000,000 190,000,000
Common stock, shares issued 7,929,581 7,929,581
Common stock, shares outstanding 7,929,581 7,929,581
XML 15 R4.htm IDEA: XBRL DOCUMENT v3.5.0.2
Condensed Statements of Operations (Unaudited) - USD ($)
3 Months Ended 9 Months Ended
Sep. 30, 2016
Sep. 30, 2015
Sep. 30, 2016
Sep. 30, 2015
Income Statement [Abstract]        
Revenues $ 0 $ 0 $ 0 $ 1,000
Cost of sales 0 0 0 0
Gross margin 0 0 0 1,000
Operating expenses:        
Race expenses 15,003 10,500 15,003 27,118
Consulting - related parties 15,000 62,500 45,000 153,000
General and administrative 13,030 10,000 33,095 30,006
Professional fees 22,402 3,250 50,377 15,750
Total operating expenses 65,435 86,250 143,475 225,874
Operating income (loss) (65,435) (86,250) (143,475) (224,874)
Other income (expense):        
Interest expense (1,875) (2,090) (5,625) (5,840)
Interest expense - related parties (9,013) (5,164) (25,718) (15,493)
Total other income (expense) (10,888) (7,254) (31,343) (21,333)
Net Income Before Taxes (76,323) (93,504) (174,818) (246,207)
Income Tax Provision 0 0 0 0
Net income (loss) $ (76,323) $ (93,504) $ (174,818) $ (246,207)
Net income (loss) per share (Basic and fully diluted) $ (0.01) $ (0.01) $ (.02) $ (.03)
Weighted average number of common shares outstanding 7,929,581 7,929,581 7,929,581 7,929,581
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Condensed Statements of Cash Flows (Unaudited) - USD ($)
9 Months Ended
Sep. 30, 2016
Sep. 30, 2015
Cash Flows From Operating Activities:    
Net income (loss) $ (174,818) $ (246,207)
Adjustments to reconcile net loss to net cash provided by (used for) operating activities:    
Depreciation 30,000 30,000
Changes in Operating Assets and Liabilities    
Increase (decrease) in accounts payable 24,015 (13,300)
Increase in accounts payable - related parties 45,000 45,000
Increase in accrued interest 5,625 5,625
Increase in accrued interest-related parties 25,718 15,493
Net cash used for operating activities (44,460) (163,389)
Cash Flows From Investing Activities:    
Assets purchased 0 0
Cash Flows From Financing Activities:    
Repayments on line of credit (1,459) (2,226)
Proceeds from line of credit to related party 187,359 245,664
Repayments on line of credit to related party (145,100) (66,126)
Net cash provided by financing activities 40,800 177,312
Net Increase (Decrease) In Cash (3,660) 13,923
Cash At The Beginning Of The Period 49,118 27,725
Cash At The End Of The Period 45,458 41,648
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION    
Interest 0 0
Income tax $ 0 $ 0
XML 17 R6.htm IDEA: XBRL DOCUMENT v3.5.0.2
1. Organization and Description of Business Operations
9 Months Ended
Sep. 30, 2016
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
Organization and Description of Business Operations

RC-1, Inc. (the “Company”), was incorporated in the State of Nevada on May 14, 2009. The Company is currently considered to be in the development stage, and has generated only limited revenues from its activities in the racing business. R-Course Promotions, LLC was formed in the State of California on October 30, 2007. On June 1, 2009, in a merger classified as a transaction between parties under common control, the sole membership interest owner in R-Course Promotions, LLC exchanged 125,000 membership interests for 1,786 common shares in RC-1, Inc. Subsequent to the consummation of the merger, R-Course Promotions, LLC ceased to exist. The results of operations of RC-1, Inc. and R-Course Promotions, LLC have been combined from October 30, 2007 forward through the date of merger.

 

The Company is a motorsports marketing business focused primary in road racing events in North America utilizing NASCAR type competition equipment.

XML 18 R7.htm IDEA: XBRL DOCUMENT v3.5.0.2
2. Summary of Significant Accounting Policies
9 Months Ended
Sep. 30, 2016
Accounting Policies [Abstract]  
Summary of Significant Accounting Policies

Basis of presentation

The Company’s financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”).

 

Interim Financial Statements

The accompanying financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to form 10Q and Article 8 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In our opinion the financial statements include all adjustments (consisting of normal recurring accruals) necessary in order to make the financial statements not misleading. Operating results for the nine months ended September 30, 2016 are not necessarily indicative of the final results that may be expected for the year ended December 31, 2016. For more complete financial information, these unaudited financial statements should be read in conjunction with the audited financial statements for the year ended December 31, 2015 filed with the SEC.

 

Use of Estimates

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

 

Net income (loss) per share

The Company utilizes FASB ASC 260, “Earnings per Share.” Basic earnings per share is computed by dividing earnings (loss) attributable to common stockholders by the weighted-average number of common shares outstanding during the reporting period. Diluted earnings per share is computed similar to basic earnings per share except that the denominator is increased to include additional common share equivalents available upon exercise of stock options and warrants using the treasury stock method. Dilutive common share equivalents include the dilutive effect of in-the-money share equivalents, which are calculated based on the average share price for each period using the treasury stock method, excluding any common share equivalents if their effect would be anti-dilutive. For the nine months ended September 30, 2016 and year ended December 31, 2015 there were no potentially dilutive shares.

 

Recent Accounting Pronouncements

Management does not believe that any recently issued, but not yet effective, accounting standards, if adopted, will have a material effect on our financial statements.

XML 19 R8.htm IDEA: XBRL DOCUMENT v3.5.0.2
3. Going Concern
9 Months Ended
Sep. 30, 2016
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
Going Concern

These financial statements have been prepared in accordance with generally accepted accounting principles applicable to a going concern, which contemplates the realization of assets and the satisfaction of liabilities and commitments in the normal course of business. The Company's ability to continue as a going concern is contingent upon its ability to achieve and maintain profitable operations, and the Company’s ability to raise additional capital as required.

  

These conditions raise substantial doubt about the Company's ability to continue as a going concern. These financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts, or amounts and classification of liabilities that might result from this uncertainty.

XML 20 R9.htm IDEA: XBRL DOCUMENT v3.5.0.2
4. Related Party Transactions
9 Months Ended
Sep. 30, 2016
Related Party Transactions [Abstract]  
Related Party Transactions

Consulting expense to related parties

 

On January 1, 2015, the Company extended for three years a previous consulting agreement with a company owned and operated by the CEO and majority shareholder to provide consulting services in the motor sports marketing industry. The consulting agreement requires a $5,000 monthly fee and can be terminated by either party pursuant to a 60 day notice. As of September 30, 2016, and December 31, 2015, the Company had an accrued payable balance due to this related party of $165,000 and $120,000, respectively. During the three months ended September 30, 2016 and 2015, the Company incurred related party consulting expense of $15,000 and $45,000 respectively. During the nine months ended September 30, 2016 and 2015, the Company incurred related party consulting expense of $ $45,000 respectively.

 

On January 1, 2014, the Company entered into an event services agreement with an event services company that is owned and controlled by an individual who is also the owner and controller of a separate company that became an owner of 16.6% of the Company's issued and outstanding common shares on June 15, 2014. During the three months ended September 30, 2016 and 2015, the Company incurred and paid $0 and $47,500, respectively, in consulting fees to this event services company. During the nine months ended September 30, 2016 and 2015, the Company incurred $0 and $108,000, respectively, in consulting fees to this event services company.

 

Due to related parties

 

On October 1, 2009, the Company entered into a line of credit agreement for up to $600,000 with a related party owned and operated by the CEO and majority shareholder that also provides motor sports marketing industry consulting services to the Company as needed. Under the agreement, the Company receives operating fund advances and reimbursement for expenses incurred on behalf of the Company. The loan bears interest at eight percent (8%) per annum. As of September 30, 2016, and December 31, 2015, the Company owed $178,164 and $155,364, respectively, in operating advances to this related party. As of September 30, 2016, and December 31, 2015, the Company had accrued interest on this line of credit in the amounts of $15,606 and $5,532, respectively.

   

On August 5, 2013, the Company entered into a line of credit agreement for up to $600,000 with a related party owned and operated by the CEO and majority shareholder. Under the agreement, the Company receives operating fund advances and reimbursement for expenses incurred on behalf of the Company. As of September 30, 2016, and December 31, 2015, the Company owed $322,372 and $302,913, respectively, in operating advances to this related party. As of September 30, 2016, and December 31, 2015, the Company had accrued interest on this line of credit in the amounts of $60,434 and $44,790, respectively.

XML 21 R10.htm IDEA: XBRL DOCUMENT v3.5.0.2
5. Subsequent Events
9 Months Ended
Sep. 30, 2016
Subsequent Events [Abstract]  
Subsequent Events

Management was evaluated subsequent events pursuant to the requirements of ASC Topic 855 and has determined that other than listed below, no material subsequent events exist through the date of this filing.  

XML 22 R11.htm IDEA: XBRL DOCUMENT v3.5.0.2
2. Summary of Significant Accounting Policies (Policies)
9 Months Ended
Sep. 30, 2016
Accounting Policies [Abstract]  
Basis of presentation

Basis of presentation

The Company’s financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”).

Interim Financial Statements

Interim Financial Statements

The accompanying financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to form 10Q and Article 8 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In our opinion the financial statements include all adjustments (consisting of normal recurring accruals) necessary in order to make the financial statements not misleading. Operating results for the nine months ended September 30, 2016 are not necessarily indicative of the final results that may be expected for the year ended December 31, 2016. For more complete financial information, these unaudited financial statements should be read in conjunction with the audited financial statements for the year ended December 31, 2015 filed with the SEC.

Use of Estimates

Use of Estimates

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Net income (loss) per share

Net income (loss) per share

The Company utilizes FASB ASC 260, “Earnings per Share.” Basic earnings per share is computed by dividing earnings (loss) attributable to common stockholders by the weighted-average number of common shares outstanding during the reporting period. Diluted earnings per share is computed similar to basic earnings per share except that the denominator is increased to include additional common share equivalents available upon exercise of stock options and warrants using the treasury stock method. Dilutive common share equivalents include the dilutive effect of in-the-money share equivalents, which are calculated based on the average share price for each period using the treasury stock method, excluding any common share equivalents if their effect would be anti-dilutive. For the nine months ended September 30, 2016 and year ended December 31, 2015 there were no potentially dilutive shares.

Recent Accounting Pronouncements

Recent Accounting Pronouncements

Management does not believe that any recently issued, but not yet effective, accounting standards, if adopted, will have a material effect on our financial statements.

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4. Related Party Transactions (Details Narrative) - USD ($)
3 Months Ended 9 Months Ended
Sep. 30, 2016
Sep. 30, 2015
Sep. 30, 2016
Sep. 30, 2015
Dec. 31, 2015
Accounts payable - related parties $ 165,000   $ 165,000   $ 120,000
Consulting to related parties 15,000 $ 62,500 45,000 $ 153,000  
Due to related parties 500,536   500,536   458,277
Credit Agreement [Member] | October 1, 2009 [Member]          
Due to related parties 178,164   178,164   155,364
Credit Agreement [Member] | October 1, 2009 [Member] | Accrued Interest [Member]          
Due to related parties 15,606   15,606   5,532
Credit Agreement [Member] | August 5, 2013 [Member]          
Due to related parties 322,372   322,372   302,913
Credit Agreement [Member] | August 5, 2013 [Member] | Accrued Interest [Member]          
Due to related parties 60,434   60,434   44,790
Chief Executive Officer [Member]          
Accounts payable - related parties 165,000   165,000   $ 120,000
Consulting to related parties 15,000 45,000 15,000 45,000  
Event Services Agreement [Member]          
Consulting to related parties $ 0 $ 47,500 $ 0 $ 108,000  
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